Blast from the Past:The Community Reinvestment Act funnels billions to left-wing activists

The Trillion-Dollar Bank Shakedown That Bodes Ill for Cities

City Journal Home.
Howard Husock
The Community Reinvestment Act funnels billions to left-wing activists, while threatening to destabilize lower-middle-class neighborhoods.
Winter 2000 The Clinton administration has turned the Community Reinvestment Act, a once-obscure and lightly enforced banking regulation law, into one of the most powerful mandates shaping American cities—and, as Senate Banking Committee chairman Phil Gramm memorably put it, a vast extortion scheme against the nation's banks. Under its provisions, U.S. banks have committed nearly $1 trillion for inner-city and low-income mortgages and real estate development projects, most of it funneled through a nationwide network of left-wing community groups, intent, in some cases, on teaching their low-income clients that the financial system is their enemy and, implicitly, that government, rather than their own striving, is the key to their well-being.

The CRA's premise sounds unassailable: helping the poor buy and keep homes will stabilize and rebuild city neighborhoods. As enforced today, though, the law portends just the opposite, threatening to undermine the efforts of the upwardly mobile poor by saddling them with neighbors more than usually likely to depress property values by not maintaining their homes adequately or by losing them to foreclosure. The CRA's logic also helps to ensure that inner-city neighborhoods stay poor by discouraging the kinds of investment that might make them better off.

The Act, which Jimmy Carter signed in 1977, grew out of the complaint that urban banks were "redlining" inner-city neighborhoods, refusing to lend to their residents while using their deposits to finance suburban expansion. CRA decreed that banks have "an affirmative obligation" to meet the credit needs of the communities in which they are chartered, and that federal banking regulators should assess how well they do that when considering their requests to merge or to open branches. Implicit in the bill's rationale was a belief that CRA was needed to counter racial discrimination in lending, an assumption that later seemed to gain support from a widely publicized 1990 Federal Reserve Bank of Boston finding that blacks and Hispanics suffered higher mortgage-denial rates than whites, even at similar income levels.

In addition, the Act's backers claimed, CRA would be profitable for banks. They just needed a push from the law to learn how to identify profitable inner-city lending opportunities. Going one step further, the Treasury Department recently asserted that banks that do figure out ways to reach inner-city borrowers might not be able to stop competitors from using similar methods—and therefore would not undertake such marketing in the first place without a push from Washington.

None of these justifications holds up, however, because of the changes that reshaped America's banking industry in the 1990s. Banking in the 1970s, when CRA was passed, was a highly regulated industry in which small, local savings banks, rather than commercial banks, provided most home mortgages. Regulation prohibited savings banks from branching across state lines and sometimes even limited branching within states, inhibiting competition, the most powerful defense against discrimination. With such regulatory protection, savings banks could make a comfortable profit without doing the hard work of finding out which inner-city neighborhoods and borrowers were good risks and which were not. Savings banks also had reason to worry that if they charged inner-city borrowers a higher rate of interest to balance the additional risk of such lending, they might jeopardize the protection from competition they enjoyed. Thanks to these artificially created conditions, some redlining of credit worthy borrowers doubtless occurred.

The insular world of the savings banks collapsed in the early nineties, however, the moment it was exposed to competition. Banking today is a far more wide-open industry, with banks offering mortgages through the Internet, where they compete hotly with aggressive online mortgage companies. Standardized, computer-based scoring systems now rate the creditworthiness of applicants, and the giant, government-chartered Fannie Mae and Freddie Mac have helped create huge pools of credit by purchasing mortgage loans and packaging large numbers of them together into securities for sale to bond buyers. With such intense competition for profits and so much money available to lend, it's hard to imagine that banks couldn't instantly figure out how to market to minorities or would resist such efforts for fear of inspiring imitators. Nor has the race discrimination argument for CRA held up. A September 1999 study by Freddie Mac, for instance, confirmed what previous Federal Reserve and Federal Deposit Insurance Corporation studies had found: that African-Americans have disproportionate levels of credit problems, which explains why they have a harder time qualifying for mortgage money. As Freddie Mac found, blacks with incomes of $65,000 to $75,000 a year have on average worse credit records than whites making under $25,000.

The Federal Reserve Bank of Dallas had it right when it said—in a paper pointedly entitled "Red Lining or Red Herring?"—"the CRA may not be needed in today's financial environment to ensure all segments of our economy enjoy access to credit." True, some households—those with a history of credit problems, for instance, or those buying homes in neighborhoods where re-selling them might be difficult—may not qualify for loans at all, and some may have to pay higher interest rates, in reflection of higher risk. But higher rates in such situations are balanced by lower house prices. This is not a conspiracy against the poor; it's how markets measure risk and work to make credit available.

Nevertheless, until recently, the CRA didn't matter all that much. During the seventies and eighties, CRA enforcement was perfunctory. Regulators asked banks to demonstrate that they were trying to reach their entire "assessment area" by advertising in minority-oriented newspapers or by sending their executives to serve on the boards of local community groups. The Clinton administration changed this state of affairs dramatically. Ignoring the sweeping transformation of the banking industry since the CRA was passed, the Clinton Treasury Department's 1995 regulations made getting a satisfactory CRA rating much harder. The new regulations de-emphasized subjective assessment measures in favor of strictly numerical ones. Bank examiners would use federal home-loan data, broken down by neighborhood, income group, and race, to rate banks on performance. There would be no more A's for effort. Only results—specific loans, specific levels of service—would count. Where and to whom have home loans been made? Have banks invested in all neighborhoods within their assessment area? Do they operate branches in those neighborhoods?

Crucially, the new CRA regulations also instructed bank examiners to take into account how well banks responded to complaints. The old CRA evaluation process had allowed advocacy groups a chance to express their views on individual banks, and publicly available data on the lending patterns of individual banks allowed activist groups to target institutions considered vulnerable to protest. But for advocacy groups that were in the complaint business, the Clinton administration regulations offered a formal invitation. The National Community Reinvestment Coalition—a foundation-funded umbrella group for community activist groups that profit from the CRA—issued a clarion call to its members in a leaflet entitled "The New CRA Regulations: How Community Groups Can Get Involved." "Timely comments," the NCRC observed with a certain understatement, "can have a strong influence on a bank's CRA rating."

The Clinton administration's get-tough regulatory regime mattered so crucially because bank deregulation had set off a wave of mega-mergers, including the acquisition of the Bank of America by NationsBank, BankBoston by Fleet Financial, and Bankers Trust by Deutsche Bank. Regulatory approval of such mergers depended, in part, on positive CRA ratings. "To avoid the possibility of a denied or delayed application," advises the NCRC in its deadpan tone, "lending institutions have an incentive to make formal agreements with community organizations." By intervening—even just threatening to intervene—in the CRA review process, left-wing nonprofit groups have been able to gain control over eye-popping pools of bank capital, which they in turn parcel out to individual low-income mortgage seekers. A radical group called ACORN Housing has a $760 million commitment from the Bank of New York; the Boston-based Neighborhood Assistance Corporation of America has a $3-billion agreement with the Bank of America; a coalition of groups headed by New Jersey Citizen Action has a five-year, $13-billion agreement with First Union Corporation.

Similar deals operate in almost every major U.S. city. Observes Tom Callahan, executive director of the Massachusetts Affordable Housing Alliance, which has $220 million in bank mortgage money to parcel out, "CRA is the backbone of everything we do."

In addition to providing the nonprofits with mortgage money to disburse, CRA allows those organizations to collect a fee from the banks for their services in marketing the loans. The Senate Banking Committee has estimated that, as a result of CRA, $9.5 billion so far has gone to pay for services and salaries of the nonprofit groups involved. To deal with such groups and to produce CRA compliance data for regulators, banks routinely establish separate CRA departments. A CRA consultant industry has sprung up to assist them.

New financial-services firms offer to help banks that think they have a CRA problem make quick "investments" in packaged portfolios of CRA loans to get into compliance.

The result of all this activity, argues the CEO of one midsize bank, is that "banks are promising to make loans they would have made anyway, with some extra aggressiveness on risky mortgages thrown in." Many bankers—and even some CRA advocates—share his view. As one Fed economist puts it, the assertion that CRA was needed to force banks to see profitable lending opportunities is "like saying you need the rooster to tell the sun to come up. It was going to happen anyway." And indeed, a survey of the lending policies of Chicago-area mortgage companies by a CRA-connected community group, the Woodstock Institute, found "a tendency to lend in a wide variety of neighborhoods"—even though the CRA doesn't apply to such lenders.

If loans that win banks good CRA ratings were going to be made anyway, and if most of those loans are profitable, should CRA, even if redundant, bother anyone? Yes: because the CRA funnels billions of investment dollars through groups that understand protest and political advocacy but not marketing or finance. This amateur delivery system for investment capital already shows signs that it may be going about its business unwisely. And a quiet change in CRA's mission—so that it no longer directs credit only to specific places, as Congress mandated, but also to low- and moderate-income home buyers, wherever they buy their property—greatly extends the area where these groups can cause damage.

There is no more important player in the CRA-inspired mortgage industry than the Boston-based Neighborhood Assistance Corporation of America. Chief executive Bruce Marks has set out to become the Wal-Mart of home mortgages for lower-income households. Using churches and radio advertising to reach borrowers, he has made NACA a brand name nationwide, with offices in 21 states, and he plans to double that number within a year. With "delegated underwriting authority" from the banks, NACA itself—not the banks—determines whether a mortgage applicant is qualified, and it closes sales right in its own offices. It expects to close 5,000 mortgages next year, earning a $2,000 origination fee on each. Its annual budget exceeds $10 million.

Marks, a Scarsdale native, NYU MBA, and former Federal Reserve employee, unabashedly calls himself a "bank terrorist"—his public relations spokesman laughingly refers to him as "the shark, the predator," and the NACA newspaper is named the Avenger. They're not kidding: bankers so fear the tactically brilliant Marks for his ability to disrupt annual meetings and even target bank executives' homes that they often call him to make deals before they announce any plans that will put them in CRA's crosshairs. A $3 billion loan commitment by Nationsbank, for instance, well in advance of its announced merger with Bank of America, "was a preventive strike," says one NACA spokesman.

Marks is unhesitatingly candid about his intent to use NACA to promote an activist, left-wing political agenda.

NACA loan applicants must attend a workshop that celebrates—to the accompaniment of gospel music—the protests that have helped the group win its bank lending agreements. If applicants do buy a home through NACA, they must pledge to assist the organization in five "actions" annually—anything from making phone calls to full-scale "mobilizations" against target banks, "mau-mauing" them, as sixties' radicals used to call it. "NACA believes in aggressive grassroots advocacy," says its Homebuyer's Workbook.

The NACA policy agenda embraces the whole universe of financial institutions. It advocates tough federal usury laws, restrictions on the information that banks can provide to credit-rating services, financial sanctions against banks with poor CRA ratings even if they're not about to merge or branch, and the extension of CRA requirements to insurance companies and other financial institutions. But Marks's political agenda reaches far beyond finance. He wants, he says, to do whatever he can to ensure that "working people have good jobs at good wages." The home mortgage business is his tool for political organizing: the Homebuyer's Workbook contains a voter registration application and states that "NACA's mission of neighborhood stabilization is based on participation in the political process. To participate you must register to vote." Marks plans to install a high-capacity phone system that can forward hundreds of calls to congressional offices—"or Phil Gramm's house"—to buttress NACA campaigns. The combination of an army of "volunteers" and a voter registration drive portends (though there is no evidence of this so far) that someday CRA-related funds and Marks's troop of CRA borrowers might end up fueling a host of Democratic candidacies. During the Reagan years, the Right used to talk of cutting off the flow of federal funds to left-liberal groups, a goal called "defunding the Left"; through the CRA, the Clinton administration has found a highly effective way of doing exactly the opposite, funneling millions to NACA or to outfits like ACORN, which advocates a nationalized health-care system, "people before profits at the utilities," and a tax code based "solely on the ability to pay."

Whatever his long-term political goals, Marks may well reshape urban and suburban neighborhoods because of the terms on which NACA qualifies prospective home buyers. While most CRA-supported borrowers would doubtless find loans in today's competitive mortgage industry, a small percentage would not, and NACA welcomes such buyers with open arms. "Our job," says Marks, "is to push the envelope." Accordingly, he gladly lends to people with less than $3,000 in savings, or with checkered credit histories or significant debt.

Many of his borrowers are single-parent heads of household. Such borrowers are, Marks believes, fundamentally oppressed and at permanent disadvantage, and therefore society must adjust its rules for them. Hence, NACA's most crucial policy decision: it requires no down payments whatsoever from its borrowers. A down-payment requirement, based on concern as to whether a borrower can make payments, is—when applied to low-income minority buyers—"patronizing and almost racist," Marks says.

This policy—"America's best mortgage program for working people," NACA calls it—is an experiment with extraordinarily high risks. There is no surer way to destabilize a neighborhood than for its new generation of home buyers to lack the means to pay their mortgages—which is likely to be the case for a significant percentage of those granted a no-down-payment mortgage based on their low-income classification rather than their good credit history. Even if such buyers do not lose their homes, they are a group more likely to defer maintenance on their properties, creating the problems that lead to streets going bad and neighborhoods going downhill. Stable or increasing property values grow out of the efforts of many; one unpainted house, one sagging porch, one abandoned property is a threat to the work of dozens, because such signs of neglect discourage prospective buyers.

A no-down-payment policy reflects a belief that poor families should qualify for home ownership because they are poor, in contrast to the reality that some poor families are prepared to make the sacrifices necessary to own property, and some are not. Keeping their distance from those unable to save money is a crucial means by which upwardly mobile, self-sacrificing people establish and maintain the value of the homes they buy. If we empower those with bad habits, or those who have made bad decisions, to follow those with good habits to better neighborhoods—thanks to CRA's new emphasis on lending to low-income borrowers no matter where they buy their homes—those neighborhoods will not remain better for long.

Because many of the activists' big-money deals with the banks are so new, no one knows for sure exactly which neighborhoods the community groups are flooding with CRA-related mortgages and what effect they are having on those neighborhoods. But some suggestive early returns are available from Massachusetts, where CRA-related advocacy has flourished for more than a decade. A study for a consortium of banks and community groups found that during the 1990s home purchases financed by nonprofit lenders have overwhelmingly not been in the inner-city areas where redlining had been suspected. Instead, 41 percent of all the loans went to the lower-middle-class neighborhoods of Hyde Park, Roslindale, and Dorchester Center/Codman Square—Boston's equivalent of New York's borough of Queens—and additional loans went to borrowers moving to the suburbs. In other words, CRA lending appears to be helping borrowers move out of inner-city neighborhoods into better-off areas. Similarly, not-yet-published data from the state-funded Massachusetts Housing Partnership show that many new Dorchester Center, Roslindale, and Hyde Park home buyers came from much poorer parts of the city, such as the Roxbury ghetto. Florence Higgins, a home-ownership counsellor for the Massachusetts Affordable Housing Alliance, confirms the trend, noting that many buyers she counsels lived in subsidized rental apartments prior to buying their homes.

This CRA-facilitated migration makes the mortgage terms of groups like NACA particularly troubling. In a September 1999 story, the Wall Street Journal reported, based on a review of court documents by Boston real estate analyst John Anderson, that the Fleet Bank initiated foreclosure proceedings against 4 percent of loans made for Fleet by NACA in 1994 and 1995—a rate four times the industry average. Overextended buyers don't always get much help from their nonprofit intermediaries, either: Boston radio station WBUR reported in July that home buyers in danger of losing their homes had trouble getting their phone calls returned by the ACORN Housing group.

NACA frankly admits that it is willing to run these risks. It emphasizes the virtues of the counselling programs it offers (like all CRA groups) to prepare its typical buyer—"a hotel worker with an income of $25K and probably some past credit problems," says a NACA spokesman—and it operates what it calls a "neighborhood stabilization fund" on which buyers who fall behind on payments can draw. But Bruce Marks says that he would consider a low foreclosure rate to be a problem. "If we had a foreclosure rate of 1 percent, that would just prove we were skimming," he says. Accordingly, in mid-1999, 8.2 percent of the mortgages NACA had arranged with the Fleet Bank were delinquent, compared with the national average of 1.9 percent.

"Considering our clientele," Marks asserts, "nine out of ten would have to be considered a success."

The no-down-payment policy has sparked so sharp a division within the CRA industry that the National Community Reinvestment Coalition has expelled Bruce Marks and NACA from its ranks over it. The precipitating incident: when James Johnson, then CEO of Fannie Mae, made a speech to NCRC members on the importance of down payments to keep mortgage-backed securities easily salable, NACA troops, in keeping with the group's style of personalizing disputes, distributed pictures of Johnson, captioned: "I make $6 million a year, and I can afford a down payment. Why can't you?" Says Josh Silver, research director of NCRC: "There is no quicker way to undermine CRA than through bad loans." NCRC represents hundreds of smallish community groups, many of which do insist on down payments—and many of which make loans in the same neighborhoods as NACA and understand the risk its philosophy poses. Still, whenever NACA opens a new branch office, it will be difficult for the nonprofits already operating in that area to avoid matching its come-one, come-all terms.

Even without a no-down-payment policy, the pressure on banks to make CRA-related loans may be leading to foreclosures. Though bankers generally cheerlead for CRA out of fear of being branded racists if they do not, the CEO of one midsize bank grumbles that 20 percent of his institution's CRA-related mortgages, which required only $500 down payments, were delinquent in their very first year, and probably 7 percent will end in foreclosure. "The problem with CRA," says an executive with a major national financial-services firm, "is that banks will simply throw money at things because they want that CRA rating." From the banks' point of view, CRA lending is simply a price of doing business—even if some of the mortgages must be written off.

The growth in very large banks—ones most likely to sign major CRA agreements—also means that those advancing the funds for CRA loans are less likely to have to worry about the effects of those loans going bad: such loans will be a small portion of their lending portfolios.

Looking into the future gives further cause for concern: "The bulk of these loans," notes a Federal Reserve economist, "have been made during a period in which we have not experienced an economic downturn."

The Neighborhood Assistance Corporation of America's own success stories make you wonder how much CRA-related carnage will result when the economy cools. The group likes to promote, for instance, the story of Renea Swain-Price, grateful for NACA's negotiating on her behalf with Fleet Bank to prevent foreclosure when she fell behind on a $1,400 monthly mortgage payment on her three-family house in Dorchester. Yet NACA had no qualms about arranging the $137,500 mortgage in the first place, notwithstanding the fact that Swain-Price's husband was in prison, that she'd had previous credit problems, and that the monthly mortgage payment constituted more than half her monthly salary. The fact that NACA has arranged an agreement to forestall foreclosure does not inspire confidence that she will have the resources required to maintain her aging frame house: her new monthly payment, in recognition of previously missed payments, is $1,879.

Even if all the CRA-related loans marketed by nonprofits were to turn out fine, the CRA system is still troubling. Like affirmative action, it robs the creditworthy of the certain knowledge that they have qualified by dint of their own effort for a first home mortgage, a milestone in any family's life. At the same time, it sends the message that this most important milestone has been provided through the beneficence of government, devaluing individual accomplishment. Perhaps the Clinton White House sees this as a costless way to use the banking system to create a new crop of passionate Democratic loyalists, convinced that CRA has delivered them from an uncaring Mammon—when, in all likelihood, banks would have been eager to have most of them as customers, regulation or not.

CRA also serves to enforce misguided views about how cities should develop, or redevelop. Consider the "investment" criterion—the loans to commercial borrowers rather than individual home buyers—that constitutes 25 percent of the record on which banks are judged in their compliance review. The Comptroller of the Currency's office makes clear that it is not interested in just any sort of investment in so-called underserved neighborhoods. Investment in a new apartment building or shopping center might not count, if it would help change a poor neighborhood into a more prosperous one, or if it is not directly aimed at serving those of low income. Regulators want banks to invest in housing developments built through nonprofit community development corporations. Banks not only receive CRA credit for such
"investment"—which they can make anywhere in the country, not just in their backyard—but they also receive corporate tax credits for it, through the Low Income Housing Tax Credit. Banks have little incentive to make sure such projects are well managed, since they get their tax credits and CRA credits up front.

This investment policy misunderstands what is good for cities and for the poor. Cities that are alive are cities in flux, with neighborhoods rising and falling, as tastes and economies change. This ceaseless flux is a process, as Jane Jacobs brilliantly described it in The Economy of Cities, that fuels investment, creates jobs, and sparks innovative adaptation of older buildings to new purposes. Those of modest means benefit both from the new jobs and from being able to rent or purchase homes in once-expensive neighborhoods that take on new roles. The idea that it is necessary to flash-freeze certain neighborhoods and set them aside for the poor threatens to disrupt urban vitality and the renewal that comes from the individual plans and efforts of a city's people.

But keeping these neighborhoods forever poor is the CRA vision. CRA will help virtually any lower-income family that can come close to affording a mortgage payment to purchase a home, often in a non-poor neighborhood. Thanks to CRA-driven bank investment, poor neighborhoods would then fill up with subsidized rental complexes, presumably for those poor families who can't earn enough even to get a subsidized, easy credit mortgage. The effects of all this could be to undermine lower-middle-class neighborhoods by introducing families not prepared for home ownership into them and to leave behind poor neighborhoods in which low-income apartments, filled with the worst-off and least competent, stand alone—hardly a recipe for renewal.

It will take a Republican president to change or abolish CRA, so firmly wedded to it is the Clinton administration and so powerfully does it serve Democratic Party interests. When Senator Gramm attacked the CRA for its role in funding advocacy groups and for the burden it imposes on banks, the Clinton administration fought back furiously, willing to let the crucial Financial Services Modernization Act, to which Gramm had attached his CRA changes, die, unless Gramm dropped demands that, for instance, CRA reviews become less frequent. In the end, Gramm, despite his key position as the chairman of the Senate Committee on Banking, Housing and Urban Affairs (even the committee's name reflects a CRA consciousness) and his willingness to hold repeal of the Glass-Steagal Act hostage to CRA reform, could only manage to require community groups to make public their agreements with banks, disclosing the size of their loan commitments and fees.

A new president should push for outright abolition of the CRA. Failing that, he could simply instruct the Treasury to roll back the compliance criteria to their more relaxed, pre-Clintonian level. But to make the case for repeal—and ensure that some future Democratic president couldn't simply reimpose Clinton's rules—he might test the basic premise of the Community Reinvestment Act: that the banking industry serves the rich, not the poor. He could carry out a controlled experiment requiring no CRA lending in six Federal Reserve districts, while CRA remains in force in six others. A comparison of lending records would show whether there is any real case for CRA. In addition, CRA regulators should require nonprofit groups with large
CRA-related loan commitments to track and report foreclosure and delinquency rates. For it is these that will reflect the true threat that CRA poses, a threat to the health of cities.

On November 4 2008, one of the arsonist's, who actively lit and stoked the fires that burnt under the fabric of American society,Barack Hussein Obama shows up with a fire hose and a carpet bag full of United Nations socialist solutions to put out the fire he and his financiers and supporters started, the American voters fell for it, just as Australian voters did on November 24 2007 in exchange for our very own Messiah of "change" our very own champion of " working families" I just hope that for America's sake that your Messiah, Oprah's "The One" Islams boy,does not do to America what Australia's "Messiah of change" "I have never been a Socialist" Australian Labor Party (Socialist left) PM Kevin Rudd and his Union financed political party are doing to Australia.

The Obama "K Street Project"

UNPRECEDENTED AND SECRETIVE (The Obama team's secretive K Street Project.)

The American Prowler
FreeRepublic.com
11/07/08

Lost amid all of the jubilation of the Obama victory was the announcement by the Obama transition team that it had set up a separate transition program beyond the one that is paid for by the American taxpayer.

Called the "Obama/Biden Transition Project," it is a 501(c)4 tax-exempt organization, with no limits on the contributions it can receive and no requirements to divulge the names of individuals or organizations that give it money.

Traditionally, the victorious campaign has set up inaugural funds, as well as funds to deal with legal costs and other expenses to close down the campaign.

Others have set up quasi-corporate offices to deal with transition issues, such as in 2000, when, with the election in doubt, the Bush-Cheney team set up a private transition office in McLean, Virginia, covering the costs from campaign contributions and other fundraising. Ultimately, the federal government, headed by the Government Services Administration, covers the cost of the transition staff, providing it with office space and all equipment.

No one is certain that any political organization has ever set up a tax-exempt entity that would be shrouded in such secrecy, particularly when Obama claimed he would be more transparent about the way things were done.

"To my knowledge, it's never been done, and people should be asking why the Obama people chose to do it this way," says a longtime Washington Republican, who has been involved in transitions for the Reagan and Bush campaign teams.

According to an Obama campaign staffer who is being retained for the transition and inauguration planning, the "project" is intended not only to identify personnel for the Obama Administration, but to then send those project employees who know all of the senior staff in the various Cabinet departments and federal agencies out into the corporate and lobbying community to leverage those contacts.

"It's taking the old 'K Street Project' that Republicans had and doing it twice as fast and on steroids," explains the aide.

"So, if you have a Project aide working on Commerce Department transition, that Project aide will be more likely to get a senior lobbying job because of all those connections at Commerce. That former Project aide will also be able raise more money for Democrats in this town and help others with jobs and such."

As well, the nonprofit may also serve as a haven for Obama supporters and campaign loyalists who for one reason or another can't be employed by the Administration or in the federal government.

"There are some people who have been with us from the beginning who are clearly political liabilities or who won't be able to qualify for a job, say, because they can't get a security clearance," says another aide, who was unaware of the unique Obama transition project's tax status.

President elect, Mr Barack Obam's "Civilian National Security Force" wannabee at work in the classroom

North Carolina Teacher Caught on Tape Teaching Pro-Obama Lessons.

Video shows North Carolina elementary school teacher harshly questioning a student in class for supporting John McCain

By Maxim Lott
FOXNews.com
Friday, November 07, 2008

The election may be over, but more allegations of political bias in public schools are surfacing.

A North Carolina superintendent said Friday that he was "shocked" after viewing video footage of an elementary school teacher harshly questioning a student in class for supporting John McCain.

William Harrison, superintendent of Cumberland County Schools in Fayetteville, has launched an investigation of the teacher, Diatha Harris, and has promised to bring disciplinary action.

In a video produced by a Swedish production company and posted on YouTube, Harris is seen asking her elementary school students whom they support for president. She tells them that they can support whomever they want, but when one student says John McCain, Harris responds derisively, "Oh my, John McCain." When another student said she supports McCain, Harris replies, "Oh Jesus, John McCain."

Harris also asks a female student to explain why she supports Obama, to which the student replies that Obama meant change -- such as ending the war in Iraq.

"So in other words, Barack is going to end that war in Iraq," Harris said before turning to a girl who had announced her support for McCain. "Now talk to me, because your dad is in the military. Talk."

The student doesn't say anything, but Harris goes on.

"It's a senseless war. And by the way, the person that you're picking for president said that our troops could stay in Iraq for another hundred years if they need to," Harris said. "So that means that your daddy could stay in the military for another hundred years."

Public school teachers are allowed to discuss politics in the classroom but are required by law to present issues from all political sides and not press agendas.

Harrison said he found the military aspect of the interaction especially worrying and promised to take action.

"Most disconcerting was the military slant that made its way into this discussion. We are a military community, serving over 15,000 military students and their families. We value the sacrifices, not only of the military parents but also those of their families," he wrote Friday in a statement on the Cumberland County Schools' Web site.

He continued: "Please be assured that the actions exhibited in this video are not consistent with the vision of the CCS. Moreover, the actions of one teacher do not represent the 7000 employees in our organization."

The video was part of "From Bill to Barack," a Swedish documentary that followed up with average Americans who had been thrown into the spotlight in the 1992 election. Harris was featured because her ex-husband, Roy Harris, had convinced former President Bush to come into his North Carolina living room and tell his children what he had done for them.

Harrison said that once the video was brought to his attention, he immediately launched an investigation. "Personnel laws prevent me from releasing information regarding individual employees and personnel action taken. I can assure you that upon completion of the investigation, I will take appropriate action," he said.

A receptionist at Mary McArthur Elementary School said that Harris did not want to comment on the case. Wanda McPhaul, Assistant Superintendent of Cumberland County Schools, said that she would not release the name of the student involved or pass a message on to the family.

This wasn't the first time the 2008 presidential election became fodder for an education controversy.

In October, an eighth-grade literature textbook used in public schools came under fire for including pages featuring Barack Obama's 1995 autobiography, "Dreams on My Father."

And a video came out in October titled "Obama Youth --Junior Fraternity Regiment," in which African American students marched into a classroom and repeated a mantra about how Obama had inspired them. The display was organized by a teacher at the Urban Community Leadership Academy, a public charter school.

In September, a school came under fire for suspending an 11-year-old boy because he wore an anti-Obama shirt to school.

If only the little girl who was the subject of this "teachers" vilification had of thought to leap to her feet and sing the "song to Obama" (Americas soon to be new national anthem ?) she perhaps would have been spared the attack from the caring,sharing and all wise Obama "Civilian National Security Force" wannabee member.

The Victim of the Obama Nazi's assault, looks decidedly uncomfortable as she endures the verbal assault / ridicule from her classroom Obama Nazi, "teacher" much to the apparent amusement of a fellow classmate... Home schooling looks better every day.

There has to be a million dollar + law suit against this disgraceful grub and her attack upon this little girl, this Obama gestapo groupie should be dragged from the classroom by the short and curlies and publicly flogged for her pathetic cowardly assault upon this young girl.
Children are sent to school to be educated not to be indoctrinated irrespective of how unpalatable that concept is to the Teachers Unions in the USA and around the world.

Teachers !!!!!! Leave our kids alone!!!! .....or be prepared to pay the price in and out of the court room .... Nazi Obama bastards F**K OFF!!!! the manifestations of your ideology are already in place in China, Iran,Cuba,North Korea and most of Africa, piss off to any of the fore mentioned where you will find Obama's grand vision of an equal and perfect political system and society, you will not be troubled by the burden's of conscience or free thought,imagination, personal aspirations values or belief's you will simply have to obey.

Australian Diamond Python EATS Wallaby

Snakes Bad Wallabies Good?

Wallabies Bad Snakes Good?

Green LOONS take note, Nature at work.

Beyonce to Obama :At your service Mr President

Beyonce loves Barry

President elect Mr Barack Obama's “Civilian National Security Force.” in action

Marxism's / Islam's mad dogs let off the leash.

See Atlas Shrugs for story re above picture

President Elect Barack Obama's relatives and friends celebrate his victory.

Kenyans rejoice, following the election of their
relative and fellow Kenyan
Mr. Barack Hussein Obama, to the office of
President of the United States of America,
"change we can believe in"

"I wouldn't want to create the impression that I wouldn't like the government of the United States to be Islamic sometime in the future...But I'm not going to do anything violent to promote that. I'm going to do it through education."
Ibrahim Hooper, Council of American Islamic Relations.
aka. "we"

Obama's Helen Jones-Kelly and Joe the Plumber

Is Joe the Plumber Barack Obama's "“Civilian National Security Force” first victim ?

I don't think so, In my opinion the Socialist's just wanted to make a public example of their despised aspirational middle / working class, so emboldened are they by their own cheer squad, the MSM, they simply could not help themselves.

I can just imagine the party officials discussing how to screw Joe where it hurts, and so keep him occupied with matters other than "disrespecting the Messiah" by asking him questions "designed to cause fear or worry amongst the correct thinking people of the USA" "hey guys lets have some fun with Joe", "who the hell does this white,uppity blue collar male think he
is ?"
Was it decided that Joe and all those he represents simply had to be taught a lesson, lest he and other such incorrect thinkers, ask more questions of the Messiah that should not be asked by any unselfish American citizen, let alone by a Plumber who sees nothing wrong with Independence,enterprise and personal effort and personal responsibility, back in your hole Joe.

So far Joe the Plumber is still alive and in good health, he has suffered death threats, and a demand for him to be killed from a left loon radio announcer in San Francisco following his encounter with Mr Obama.

How many more Helen Jones-Kelly's are there in the US public service ? maybe she is the first public face of Mr Obama's new elite “Civilian National Security Force.” whose brief will be to change the worlds opinion of America , code for convincing the United Nations/ Eurabia and the rest of the worlds despots that just like their once free people, America's will soon be under the boot heel of international socialism.

Before the November 2007 Australian federal election, deputy Labor Party leader and former leftist activist (left wing ratbag & loon) Julia Gillard enunciated her desire to see Union Offices in every suburb, so as to monitor "working families" and ensure their rights are always maintained, I wondered what other matters these socialist (and Labor party fund raisers) "monitors" would concern themselves with, just as Helen Jones- Kelly has taken it upon herself to investigate the private life of Joe the Plumber.....

The Messiah's “Civilian National Security Force.” clearing their heads of bad thought with hymn's to their new Master ?

Those who can make you believe absurdities can make you commit atrocities.
Voltaire
French author, humanist, rationalist, & satirist (1694 - 1778)

....well she did didn't she? take it upon herself I mean.... or did a superior higher up in the "civilian army" / Democratic Party tap her on the shoulder and simply hand her a piece of paper with Joe's name on it and instructions to give him something else to think about.

If Helen Jones -Kelly acted alone and out of a sense of loyalty to Mr Obama she should be dismissed.

If Helen Jones -Kelly was instructed to do a number on Joe the Plumber she should tell us who ordered her to do it and then she should be dismissed.

Helen Jones-Kelly should also be thoroughly investigated to see if she has violated any state or federal laws regarding privacy issues and prosecuted till the cows come home.

Political Correctness and the cult of Multiculturalism have shut down debate and made the western world defenceless against those whose admitted objectives are to destroy the western world and Judeo / Christian civilization.

Could Mr Obama's planned “Civilian National Security Force.” be the new hands on enforcers of "correct thought"
and will Helen Jones-Kelly be revered or scorned for exposing the purpose of this new 'civilian army" so public so soon or was she simply doing what she was told... like all good servants of the Socialist / Humanist manifesto are want to do in order to show their loyalty to Messiah / Dear Leader.

Obama a one trick pony.

"......Based on Obama’s record, voting for change, solely for change’s sake, is an affront to commonsense and a victory for stupidity."

What else has Obama got?
Piers Akerman
News.com.au
Monday, November 03,
2008 at 11:19pm

BARACK Obama’s predicted victory in the US presidential election is more likely to usher in a bleaker future for the globe, not the bright new dawn his optimistic supporters are hoping for.

Obama, an inexperienced first-term senator, has not presented the world with a blueprint for the future, he has run his extraordinarily successful campaign on nothing more than the promise of change.

As we have seen in Australia over the past 12 months, change is not always for the better.

See previous Aussie News & Views post:

Americans BEWARE Australian internet to be CENSORED by Australian Labor Party

Obama’s promised change is part of what pollsters are claiming as the mainstay of his attraction - vision.

Unfortunately, his vision is no more than the word. His vision is one-dimensional. It is in reality nothing less than a mirror in which supporters can see anything they hope to see. It is limitless, constrained only by the imagination of those who feel the need to embrace change and vision.

Empirically, however, all the evidence shows Obama is more limited than limitless. He is a creature of the historically corrupt Chicago political machine, an organisation that could teach WA Inc and the ALP’s notorious NSW Right about political larceny.

He is an enthusiast for the cause of victimhood and attended and wholeheartedly supported a racist church leader for the past two decades until the media reluctantly exposed the hate-spewing sermons of the Reverend Jeremiah Wright, Obama’s pastor of choice until the middle of this year.

Last weekend, when former US president Bill Clinton endorsed the man who defeated his wife Hillary in the long struggle for the Democratic Party’s nomination, it was worth remembering that Wright had preached in Obama’s church that he (Clinton) “Did us (black Americans) like he did Monica Lewinsky”. Obama didn’t object.

Clinton prided himself on his relations with black Americans and was called by many commentators an honourary black but that cut no ice with Wright, who also preached God damn America.

That would have suited the man credited with launching Obama’s political career, the unrepentant former urban terrorist Bill Ayers, and Ayers’ partner Bernadine Dohrn, who served time in prison for her role in the Weatherman domestic terror bombings of the late 1960s and early 1970s.

Obama has said his own limited political experience largely hinges on his work as a community organiser. That would be for the activist organisation ACORN, which has been cited numerous times across the US for falsifying information used to register voters.

On character grounds, Obama is fortunate in the extreme to have reached the dizzy heights of the US Senate, to have found himself as the Democratic Party’s candidate.

He needed Senator Clinton. Without a white woman contesting the party’s nomination, it seems unlikely a black man would have won the party’s vote.

Though Obama’s Republican opponent, war hero and former PoW and US Senator John McCain, has not raised race as an issue, the Democrats have used it to engender a sense of guilt in white Americans who harbour doubts about Obama’s capacity as the leader of the free world. Not to support Obama raises the question of whether that decision has a racist undertone.

Shelby Steele, a research fellow at the Hoover Institution at California’s prestigious Stanford University, characterised the phenomenon as arising from the fact that whites, since the ‘60s, have been stigmatised as racist.

He said since acknowledging a history of racism, segregation and slavery, whites had lived under the pressure of having always to prove they’re not racist; they developed political correctness for the sole purpose of being able to talk without seeming to be racist.

White people, he said, are desperate to vote for a black man to prove the US is not a racist society. Some people who have had the opportunity to meet Obama during the campaign have told me they are concerned what a Democrat victory will mean for Australia.

They say in conversation he showed an extraordinary naivete about economics, one describing his views as Cuban circa 1960; his foreign policy outlook was very ‘70s Eurocentric; and it was also pointed out that in his foreign policy statement he made no reference to Australia’s role in future schemes.

Further, it was noted that the Democratic Party leans towards greater protectionism and is well behind the ALP in its thinking on globalisation and the trade implications of modern technology.

While a vote for Obama may bring about a temporary boost of confidence in the US and a bounce on Wall Street, there is nothing to suggest an Obama administration will be good news for the rest of the world in the longer term.

Based on Obama’s record, voting for change, solely for change’s sake, is an affront to commonsense and a victory for stupidity.

Comrade Rudd ....Bono's Idiot in search of a village.

When Rudd comes to town ... Bono couldn't care less

By Malcolm Farr
News.com.au September 27, 2008 12:00am

U2'S Bono seems to be moving in mysterious ways as he shakes hands with Kevin Rudd - his mind obviously elsewhere.

They say a picture is worth a thousand words, in the case of this picture
how about a couple hundred thousand words.

Their chat about needy nations was one of dozens of meetings the Australian Prime Minister held in a hectic three days in New York.

Mr Rudd has filled his overseas schedule to the brim to dampen criticism over his rapid accumulation of frequent flyer miles. What's going on in this picture? Enter our caption competition But if the rock star appeared to snub Mr Rudd, so did most of the 190 UN members when the Prime Minister addressed the General Assembly.

Following Brunei and South Korea late in the day, Mr Rudd delivered his lecture on financial stability to a giant hall which was just a quarter full. Worse, his chief of staff David Epstein and Australia's UN Ambassador Robert Hill looked like they were nodding off as he spoke. "There has been a failure of internal governance within financial institutions, there has been a failure of external oversight," Mr Rudd told those listening.

I told you there would be jokes on Aussie News & Views so here goes :

U2's Bono was at the front of the stage in a break between numbers clapping his hands, clap... clap...clap... clap... then stopping to say to the audience, clap...clap... do you know, clap...clap... that every time I clap my hands... clap...clap... a child dies in Africa,clap... clap......silence
then a voice was heard from the audience "well why don't you stop F*****G clapping ya low bastard "

Carbon Hoax exposed again.

Carbon is the worlds best friend

By David Bellamy and Jack Barrett History has it that an apple fell on Isaac Newton's head allowing him to realise why, "what goes up must come down" and go on to formulate the basic laws of physics. Revisiting those laws in the infrared glow of the global-warming debate forces the realisation that when it comes to radiant heat, "what comes down must go up" -- for if it didn't, the Earth would overheat. Some 50 years after the end of the Little ice age, in a time we now call the pre- industrial age, the world appeared to be well content with an atmosphere containing 285 ppmv of CO2 and the average amount of water vapour. Since 1992 we have had a special UN-supported Intergovernmental Panel on Climate Change warning the world that we are heading for real trouble, if the concentration of carbon dioxide, one of the five so called greenhouse gases in the atmosphere doubles its pre-industrial value. Here are ten, let us call them Newton's Apples, that sow real seeds of doubt about the science behind the IPCC's conclusions.

(1) Measurements prove that the pre-industrial damp blanket trapped 94.7% of all the infrared radiation as it escaped into space leaving a mere 5.3% to warm the great interstellar sink directly. All this thanks to the fact that the spectral escape window was partially blocked by what we now call the greenhouse gases that kept the Earth warm.

(2) If we took no notice of the IPCC's warnings and burned all the known reserves of natural gas, the concentration of carbon dioxide in the atmosphere would rise to 454 ppmv.

(3) Now throw caution to the wind and burn all the oil reserves we know about -- and the CO2 concentration would go up to 489 ppmv. Still nowhere near the dreaded doubled value of those "halcyon" pre industrial days.

(4) So let's pull out all the stops and burn at least one-third of coal reserves in all its forms. With an awful lot of mining we would make the now much-feared figure of 570 ppmv. A point, at which IPCC's super computer models warn that the sky might soon come falling down. They rarely mention the fact that around 600 million tonnes of extra potential plant fertilizer and about 1 billion tonnes of extra irrigation water hanging about up there, continue to help balance the biosphere while increasing the atmospheric pressure by a mere 0.3 millibars. The atmospheric blanket would now trap 95.6% of the infrared radiation (a mere increase of 0.9% over those pre-industrial days) and the potential absorption by the combination of water vapour and CO2 is almost complete -- thanks to the logarithmic relationship between concentration and radiance/absorption.

(5) Simple arithmetic also proves that at this moment of time in the IPCC's countdown to catastrophe the annual increase of CO2 pouring into the atmosphere is a mere 3% of the natural turnover of this very important gas in the atmosphere. Thus leaving little doubt that there is massive buffering capacity in the system.

(6) A smidgen of maths proves that all the much "feared" doubling of the concentration of CO2 in the atmosphere actually accomplishes is a slight narrowing of the infrared 'window' through which radiation escapes to space.

(7) Checking the spectra also shows there is a window in that infrared escape route that can never be closed because there are no natural gases with the right spectral bands. If there were the temperature might then go up by around 5 degrees Celsius.

(8) Measurements also show that the infrared absorption spectra of all the greenhouse gases overlap to a certain extent; in consequence, their cumulative effect can never be realized. A cumulative effect that is already nearing saturation when no further heat will be trapped, thanks to the fact that the relationship between the concentration of any of the greenhouse gases and radiance/absorption is logarithmic.

(9) Despite all this incontrovertible evidence that the increase of the concentration of carbon dioxide in the atmosphere is a benign and almost spent force, the global warmers beg to differ. Their conclusion, drawn from a plethora of complex computer models, leads them to warn the World that an increase in trapped radiation of only 0.9% might trigger a catastrophic course of events. A chain reaction that could be responsible for a runaway enhancement of global warming that could pose a threat to much more than our way of life. To give their argument teeth, they appear to put all their eggs into the basket of what they call radiative forcing, building into their models only positive feedbacks related to water vapour that trap more heat.

(10) Newton's Law of Cooling perhaps drops the largest apple on the head of the IPCC's arguments of a melt down scenario. In the simplest of terms, it proves that if the non-radiative properties of water (evaporation, albedo, mass transfer etc.,) were not already at work at the earth/ atmosphere interface, the Earth's surface would be some 13°C warmer.


So again there is a lot of negative feedback in the system. The global warmers can hypothesise as much as they like about the cause and effect of trapping the last few percent of the available infrared radiance by the greenhouse gases, but without admitting that there is another source of heat at play in the system their scare mongering is no more than hot air. Take heart all those super climate modellers: There is still a lot of work for your giant computers to get stuck into. Take a few gigabytes out of Newton's Apples and get cracking solving the real problems that face over 6.4 billion human beings as they move into an uncertain energy-hungry future. Please remember that the main reasons for soil erosion, salination, floods, droughts, famines, the collapse of coral reefs and the extinction of species are habitat destruction, overgrazing and over-fishing -- not a 0.9 % rise in trapped radiance.


Carbon dioxide is not the dreaded greenhouse gas that the global warmers crack it up to be. It is in fact the most important airborne fertiliser in the world and without it there would be no green plants at all. In fact, a doubling of the levels of this gas in the atmosphere would bring about a marked rise in plant production -- good news for everyone, especially those malnourished millions who can't afford chemical fertilisers. Perhaps the time is ripe to really start worrying (again) about the fact that for the last 200 million years the concentration of carbon dioxide in our atmosphere has been falling. Indeed it dropped to dangerously low levels during recent ice ages. The Plant Kingdom responded to this potentially catastrophic (no carbon no food) situation by producing the so-called C4 plants that can survive low CO2 by using sunlight more efficiently. Please talk to your plants -- and as you do, rest assured that they in effect will thank you, by recycling your waste carbon dioxide to make more plant material and return oxygen to the earth's atmosphere. -------------------

CARBON IS THE WORLD'S BEST FRIEND By David Bellamy and Jack Barrett sepp.org

Dr David Bellamy OBE. Plant Ecologist, Author, Writer and presenter of TV documentaries for BBC and ITV, International campaigner for the rational use of the resources of the biosphere.

Jack Barrett, PhD (Physical chemistry, Imperial College, London) ***************************************
Skeptical Scientists

"Barack Obama could worsen world financial crisis "...Rupert Murdoch.

"....Mr Murdoch criticised Senator Obama's tax policies as "crazy"

NEWS Corporation chairman Rupert Murdoch has warned that Barack Obama could worsen the world financial crisis if he is elected US president next week and implements protectionist policies.

The Australian's business writer, Glenda Korporaal interview with Mr Murdoch appeared in the Weekend Australian November 1.

"Mr Murdoch said the Democrats' policies would result in "a real setback for globalisation" if implemented"

"Mr Murdoch criticised Senator Obama's tax policies as "crazy", particularly his plan to hand out tax rebates to most Americans and to increase taxes for people earning more than $250,000. He said Senator Obama's promises to give tax rebates to 95per cent of Americans was "rubbish".

"Forty per cent (of the US population) don't pay taxes, so how can he give them a tax cut?" he said. "But you can give them a welfare cheque which he has promised - a grant of $500 - which will disappear very fast. It's not going to turn the economy around at all."

"Mr Murdoch said Senator Obama would make the situation worse if he implemented the policies he had promised the American union movement, which represented only 12 per cent of the US workforce, most of them government workers."

"We have the historical precedent of Smoot-Hawley," he said."

Full article here

World's Despots mock Barack Obama

I think this just about says it all.